On a call with reporters, Citizens CEO Barry Gilway explained that the firings were actually meant to
boost fraud detection within the organization.

The hastily arranged call came briefly after two groups held
a conference asking Gov. Rick Scott to look into the firings of the four corporate
integrity employees responsible for investigating fraud, sexual harassment and
other improprieties at the state-run insurer.

“We set up the Office of Corporate Integrity with the best
of intentions,” said Gilway. “Unfortunately, the mission of the office was not
adequately designed.”

Gilway said the corporate integrity watchdogs—one a former
economic crimes investigator with the attorney general’s office and the other a
former official with FDLE—were spending their time looking into minor human
relations complaints, rather than serious fraud.

Gilway admitted that it was a mistake to abruptly disband the Office
of Corporate Integrity in the middle of an Inspector General’s investigation
into Citzens’ lavish corporate spending.

But Citizens has also made several mistakes in its attempts to explain the firings. The company has had to backtrack from several parts of its
initial account, causing confusion about what actually happened,
and producing growing suspicion among good governance groups and lawmakers.

For example, Citizens initially said that it fired the four corporate
watchdogs in order to beef up its fraud investigations unit, but later noted
that no forensic accountants have been hired.

“…as of today, new personnel have not been hired to handle
the increased workload,” he wrote. “An effective compliance system cannot be
achieved without an adequate number of independent, highly trained
professionals.

Citizens also said that it fired members of the Office of
Corporate Integrity because they “lacked the financial forensics expertise to identify
and proactively investigate potential fraud and abuses." But just a few
sentences later in the same press release, the insurer said of those employees: “all were encouraged to apply for the [newly created] positions and certainly
will be considered if they apply."

On Monday, Gilway clarified that it was actually clear that employees
did not have the expertise necessary, so they shouldn’t apply for the new positions.

Citizens also has had to clarify its initial press
release in order to make clear that the organization did not actually get
official approval from the Audit Committee to conduct the firings.

The initial press release stated that:

“To address these issues, the Board of Governors’ Audit
Committee approved a recommendation by the Chief of Internal Audit that the
Office of Corporate Integrity be replaced by a staff of four qualified forensic
accountants trained and experienced in the management of potential corporate
fraud and abuse.”

Citizens has since clarified that no official recommendation
was made to the Audit Committee in writing, and the committee never held meetings to discuss the proposal to disband
the Office of Corporate Integrity.

Comments

You can follow this conversation by subscribing to the comment feed for this post.

Finally! I don't understand why those big corporates can have a free pass like they are some gods. This is why a good corporate fraud investigator like this company http://www.jpinvestigations.com/insurancefraud/ is needed to help consumers protect themselves. Thanks for posting this!